The British Museum bought an ancient Egyptian artefact from a dealer with a conviction for smuggling antiquities out of the country, The National can reveal.
It told The National the artefact was currently the subject of its co-operation with an investigation by US authorities. It said the nature of its assistance to the US authorities was “ongoing”.
Experts have questioned whether the museum carried out any due diligence on Mr Khouli and the wisdom of it relying on scans of ownership records provided by a criminal whose convictions include making false statements.
The British Museum was embroiled in scandal recently after it was revealed 2,000 artefacts had been stolen from the institution over a “significant” period of time, leading to the resignation of its chairman Hartwig Fischer.
Mr Khouli pleaded guilty to buying and smuggling Egyptian antiquities, including coffins, funerary boats and limestone figures, according to the US Attorney’s Office for the Eastern District of New York.
He smuggled them into the US by making false declarations to customs about the country of origin and value of the items, prosecutors said, in 2012.
British Museum records show a shabti dating from the Thirteenth Dynasty of Ancient Egypt, which lasted from 1782-1650 BCE, was bought in 2017 from Mr Khouli’s Palmyra Heritage Gallery.
Angelika Hellweger, a lawyer and art crime expert, told The National Khouli's name should have raised “red flags” with the British Museum.
She said it was “astonishing” that the museum accepted scans of documents showing family ownership from someone convicted of making false declarations.
“Where are the originals? That’s what I want to know, because a scan can be manipulated,” said Dr Hellweger, a legal director at London firm Rahman Ravelli.
“They put it in writing on the acquisition notes that they received scans, which I find astonishing. You can’t properly verify a scan. As a lawyer, the fact that there’s only scans would make me nervous.
“Does the British Museum have an explanation from Mr Khouli about why there’s only scans?”
The museum says in the acquisition notes outlining ownership that Mr Khouli provided scans of a four-page Arabic document, which record the purchase of the artefact in 1946 by an Egyptian man, Ezz el-Din Taha el-Dharir, who then took it to Brooklyn two years later.
It remained in the possession of his family until it was sold by a descendant of the original buyer, Dr Ashraf el-Dharir, a collector in Brooklyn, the British Museum said.
Dr Hellweger explained that the community of antiquities dealers such as Mr Khouli was “not a big one”, so his background should have been familiar to whoever was overseeing the purchase of the shabti.
“There should have been red flags raised when dealing with such an individual,” she said.
“The question is whether the British Museum had this purchase checked by independent experts. Maybe Mr Khouli sold a legitimate item but there is, at least, suspicion.
“I would say they really needed to do due diligence, especially if they’re buying from a dealer with a criminal conviction.”
Dr Hellweger said the fact that the artefact was recorded as being in the hands of the family for such a long time also raised suspicions and in her experience that has been used as a cover.
"Fraudsters who don't really have enough provenance documents say 'this antiquity was 50 years in family hands'. It's only an indicator and it needs digging into deeper."
The British Museum describes the shabti as 15cm tall, with “eyes with heavy lids and an unsmiling mouth” and a “rare” combination of attributes.
Prosecutors said Mr Khouli covered up the smuggling, which took place between October 2008 and November 2009, by making false statements to law enforcement authorities.
He also provided misleading descriptions of the contents on shipping labels and customs paperwork.
The antiques dealer had faced up to 20 years in prison but was sentenced to one year of probation, six months of home confinement and 200 hours of community service.
The items he trafficked were confiscated from him and subsequently repatriated to Egypt in April 2015.
The antiquities returned to Yemen in February included 64 relief carved stone heads, 11 Quran manuscript pages, a bronze inscribed bowl and a funerary stele from tribal cultures in the highlands of north-western Yemen dating back to the 1st century BCE.
Rick St Hilaire, a lawyer and former chief prosecutor in the US who is a leading authority on transnational cultural heritage crime, followed the case of Mr Khouli’s original prosecution back in 2012.
“If you’re a curator and I’m the general counsel, the conversation we should be having is what due diligence must be done when purchasing an item,” he told The National.
“And one important aspect of due diligence is knowing the person offering the piece for sale.
“In a US courtroom, if a testifying witness has been convicted of a crime of dishonesty then as a prosecutor, you can use that conviction to question their credibility.
“Generally speaking, is it good stewardship for a museum or a collector to acquire an item from a dealer who’s been convicted of a crime, specifically for antiquities trafficking?
“If I’m a general counsel advising a museum and we know that a dealer offering an archaeological object for sale has a criminal background related to antiquities trafficking like smuggling, trade fraud or theft, then I would say just stay away from it. It’s too risky, and why invite reputational harm?”
Mr St Hilaire said the antiquities world was lacking comparable standardised due diligence processes that exist to prevent financial crime.
“The problem is that you don't have an accepted best practice for due diligence to discover looted or smuggled cultural objects and there’s no standard as a benchmark, so people can overlook having to look deeper into a dealer’s background or getting import documents and the like,” he said.
“While there are notable exceptions, many museums still are not getting that when you buy antiquities, you’re walking into the realm of the black and grey markets that piggyback the legitimate market. Buyer beware.”
Chris Marinello, a leading expert in recovering stolen, looted and missing works of art, said conducting due diligence was not difficult.
"It would seem that the due diligence department, if there is one, at the British Museum needs to learn how to conduct a Google search," Mr Marinello, the founder of Art Recovery International, told The National.
"Had they done so at the time of acquisition, they would have instantly been alerted to the US Attorney's Office Press Release and Forfeiture Notice dated April 18, 2012 regarding their seller. I can't think of a more obvious red flag."
A British Museum representative on Monday said: “Establishing the provenance of an object is an integral part of the museum’s acquisition process.
“We have been offering assistance to the US authorities in New York with enquiries since 2019. It would be inappropriate to comment further while these remain ongoing.”
Mr Khouli has been contacted by The National for comment.